Commentary: Paul Ebeling on Wall Street
$DIA, $SPY, $QQQ, $VXX
Last Friday, “Goldie” (NYSE:GS) issued a Southside warning for the S&P 500, again.
Note: for almost 8 years the US Fed has been printing money in the trillions in an effort to inflate the economy and instill the notion of wealth in the people.
And then what happened?
- The middle class has dropped below 50%
- Capital investment in the US is still at recession levels
- 94-M working aged people out of the workforce thus pushing
the labor rate lower.
- Economic growth is stagnant to NIL.
Back to Wall Street: the stock market indexes looked to be in a position to sell off, but they bounced off of their 50-Day MA’s capping the selling on the notion that a Fed that likely will not raise rates acts as a counterweight to any Southside pressure, keeping the indices from selling off.
So, with the US Fed likely to keep rates steady thanks to a weak retail sales report Thursday.
As I write this report the 3 US major market indexes are trading marginally higher.
With the FOMC likely to keep rates the same (the officials could always ‘surprise’ Wall Street) if there is any Southside
between now and the meeting on Tuesday and Wednesday, that might be the Southside’s “last hurrah” for a while.
But, if there is Southside action to start this week let Southside positions run as far as they will then, hopefully after sharp early week drop, bank the gainers in preparation for a next Northside move.
Hey, if there is a sharp move South, that is all the more reason the FOMC would not hike rates now, as it has to give deference to the markets.
And as always, take what the market gives.
The Bulls Vs The Bears
VIX: 15.37; -0.93
VXN: 15.14; -1.25
VXO: 14.8; -0.71
Put/Call Ratio (PCR) CBOE: 1; +0.16; Nine 1.0+ readings in 3 weeks, 5 of 8 sessions over 1.0.
Last week Wall Street Bulls fell from the 56.7% high hit on this round, that was enough to start at least some selling. The threshold seems to get lower as this rally continues.
And the Wall Street Bears fell as the market struggled.
The Bulls are at 49.0 Vs 52.5 last
The Bears are at 22.6 Vs 22.8 last
Support and Resistance
DJIA close: 18,222.15
18,247 the Aug 2016 low
18,288 from Mar 2015
The 50-Day EMA: 18,310
18,351 the May 2015 high
18,595 the Jul 2016 high
18,669 the Aug 2016 all-time high
18,168 the Apr 2016 high
18,181 the Jul 2015 high
18,016 the June 2016 peak
17,978 the November 2015 peak
17,600 the bottom of the April-June 2016 trading range.
The 200-Day SMA: 17,574
S&P 500 close: 2139.16
The 50-Day EMA: 2154
2175 the Jun 2016 high
2194 the Aug 2016 high
2135 the May 2015 high
2130 the Jun 2015 high
2126 the Apr 2015 high
2120 the Jun 2016 high
2116 is the Nov 2015 high
2111 the Apr 2016 high
2104 the Dec 2015 high
2094 the Dec 2014 high
2079 a Nov 2014 high
2062 a Jan 2015 high
The 200-Day SMA: 2059
NAS Comp close: 5244.57
5271.36 the Aug 2016 all-time high
5288 the Sept 2016 high
5232 the 2015 all-time high
5162 a Nov 2015 high, 5176 is the December intraday peak
The 50-Day EMA: 5150
5100 a May 2016 high
5042 the Mar 2015 high
5009 a Mar 2015 high
4999 the Oct 2015 upper Gap mark
4980 the Jun 2016 high
Have a terrific week